The Palestine/Israel conflict has been a defining feature of the global political landscape for decades. Its resolution would present a major challenge to the status quo and those who benefit from it. It also would badly damage the careers of the legions of Middle East experts the world over.

These experts have talked about us being at a crossroads with regard to resolving this issue and done so every year of every decade in every conference about this conflict. It is my misfortune to state, at this conference, that we are yet again at a crossroads, and perhaps this time it is for real.

The Iraq War has removed the fortress that separated the Arab World, with its historical Sunni political dominance, from Persian Iran the exclusively Shiite state. With assets in Iraq and in the Syrian regime, Iran flexed its muscles this summer through its ally, Hezbollah in Lebanon and in Palestine through its new alliance with the Sunni Hamas.

Both alliances were cemented by a fight against Israel and presented a major intrusion of Iran in the Arab world in a bid to go over the heads of Arab governments and own the Palestine issue with all its attendant symbolism. Iran has emerged as a regional super power in the Middle East and is defiantly challenging the only global super power.

The moderate Arab regimes, Israel, and Mahmoud Abbas in Palestine find themselves on the side of the United States and at odds with Iran and its proxies. It can hardly be expected after decades of wars and deep rooted hostility to create a coalition between the Arab States and Israel to counter the threat of a Muslim nation, albeit Shiite.

The only way this coalition would be thinkable would be to move with dispatch to bring the Palestine Israel conflict closer to a resolution. Recent events have rendered the creation of such a state more achievable because it fits in with a global and regional strategy to build a coalition against extremism.

It falls upon this Administration, which still has two years of service, to seize the opportunity created by the confluence of the interests of various nations: It is in the national interest of the United States, moderate Arab States and that of Israel to contain Iran, its proxies and militant religious Shiite or Sunni movements.

It is also in the national interest of the Palestinians to have their own viable, independent state on land occupied in 1967. These are the ingredients of a historic compromise.

Our immediate challenge is to translate policy into politics. A partnership needs to be forged between Palestinian and Israeli leaderships under an American umbrella. Unfortunately, all three political systems suffer at the moment from deep fragmentations and serious internal strains.

At a time that calls for decisive leadership, we find leaders who lack public support. It remains to be seen whether weak leaders can enhance their positions as they slowly move forward on this issue.*

Although the parties to the Palestine/ Israel conflict have never come close enough to sign an agreement, there has emerged over decades an international consensus which calls for two states with mutually acceptable borders based on 1967. However, tribal fault lines that block its realization linger just below the surface.

Should we fail in this crucial year or two to make progress on the national struggle between Israel and Palestine the conflict may yet be redefined solely as a Holy War that will cast its shadow far beyond the first decade of this century.

The United States, as a strategic partner to the Palestinians and Israelis, and a coordinator of the other regional partners committed to a peaceful Middle East, has to learn from its experience to be a more effective partner. It should aim to end this conflict- neither to manage it, nor to out-source it, nor to let it fester.

Imposing solutions, pressuring partners, or yielding to the more belligerent players are all traps to be avoided. The mechanisms, time lines and the gentle and not so gentle nudges have to be guided by a benign vision of the end game- one that neither party would ardently embrace nor utterly reject.

This end game will be a variation on the themes of Taba, Geneva Accord, The Arab League Initiative, and the June 24, 2002 Speech of President Bush of June 24, 2002. The envisioned regional coalition will give new relevance to the Arab League Initiative.

The Palestinians and Israelis must negotiate on their own behalf, with the guiding and gentle American hand keeping them on task. The ultimate task is to end the conflict.

The United States’ role is indispensable not because it is an honest broker but because it is the only power that can be effective, both in dealing with the two parties as well as with other significant players whose input and support is crucial. People should disabuse themselves of the illusion that anyone but the United States can play this role.

A trilateral meeting is now set between Secretary Rice, the point person assigned for this mission by the President, and President Abbas and Prime Minister Olmert. Their meeting will, appropriately, take place after her meetings with the Quartet and with representatives of Arab Leaders. Formal negotiations at this trilateral level need to be institutionalized.

A successful conclusion of the initial meetings would be an agreement on the principle of a partnership, and establishing guidelines and mechanisms that govern the partnership and its objectives.

Negotiations, especially those involving two leaders with serious internal challenges, will benefit by setting a low level of expectations. The advantage of the fact that meetings and negotiations will stretch over a period of time is that we can put this time to good use by preparing the Israeli and Palestinian public to bridge the gaps between their expectations and reality.

This can be best accomplished by engaging in public discussions about the issues to be negotiated to convince the skeptical people of the seriousness of the exercise. Leaders, who are politicians, will lead with more confidence if they sense the support of their public no matter what their political opponents say.

Israel, whose dysfunctional political system is saved by a functional legal system, needs to come to terms with the need to end the occupation. Eretz Israel and the religious or mythical impulse that drove it must come to terms with the reality of its un-sustainability. Indeed the whole range of issues to be negotiated between Israeli and Palestinian officials in confidence need to become subjects of public debate.

These include the future of the settlements, the policy of humiliation of the Palestinians, the grinding and restrictive realities of imprisonments, checkpoints and impoverishment. Discussion needs to take place about ways to transition all of these back to normalcy.

Innovative and bold ideas have to be aired and discussed publicly about the future of Jerusalem, borders, and the refugees as well as the future relations of Israel at peace with the Palestinian and with all other Arab States.

Securing the future of an Israel that lives in peace and not only by the sword is a goal that would be enhanced by creating a partnership with the secure state of Palestine. The present relations between the Jewish people and the German people teach us that historic animosities, no matter how brutal and gruesome, are not insurmountable and eternal obstacles to reconciliation and accommodation.

It should be thinkable, that the lifting of the humiliation and its manifestation against the Palestinians coincides with a campaign for a more measured and serious public debate in responsible media across the Arab world on issues related to Israel and to the Jewish people.

The Palestinians must define what they want. Their system is dysfunctional and they are hopelessly divided and presently engaged in an intermittent civil war. They have to clearly make a choice between two visions: A negotiated viable, contiguous, sovereign state of Palestine established on agreed upon 67 borders, with East Jerusalem as its capital. One that secures the rights of the refugees based on international legality, offering them citizenship right to live in Palestine, providing them opportunities to live elsewhere if they so choose, affording them full compensation for their losses and offering them an apology for their original losses.

In exchange, they have to accept the painful fact that the vast majority of the four or five million refugees will not go back to their homes, to villages and towns that exist no longer. The United Nations, which dispossessed the Palestinians by a resolution that created Israel in 1947, should pass a resolution to establish Palestine and offer to set up the package and mechanisms for compensation and resettlement. It should also offer its own apology to the refugees it helped create.

Arab East Jerusalem must be the capital of Palestine or the conflict will not be ended. Religious feelings raging in the hearts of too many people in the world will see to that.

The other vision facing the Palestinians, and the one that appeals to their victim hood, calls for liberating all the land of Palestine in time by force. It is the one advocated these days primarily by militant Islamic parties. It carries the apocalyptic vision of repetitive wars that would ultimately lead to destruction of unimaginable scale, one that the bulk of the Israelis and Palestinians, and many others, may not survive.

In the short run, this vision promises no relief from the occupation and its misery for the Palestinians, no matter what it promises to deliver in the long run.

For the Palestinians to decide between these two visions they must believe that the goal of a viable Palestinian state is indeed achievable. A tiny minority of Palestinians and others clamors for one state. Theirs is a voice of frustration that settlement expansion has already made a viable Palestine unattainable. Their argument will carry weight if it is not answered appropriately through a negotiated agreement.

The Palestinians are justified in their skepticism as they look at the settlements, walls and fences, exclusive roads and witness and suffer the consequences of an unbroken record of broken promises.

Palestinian belief that the option of a viable state is real will be enhanced immeasurably if they experience a palpable and speedy improvement in the reality of their daily lives and if they believe that it is part of a political horizon. Political dividends will accrue to Palestinian leaders who advocate this vision in direct proportion to the improvement of the people’s lives. No better tool than this would deprive extremists from a political base and fresh recruits.

President Abbas must outline his vision for the nature and the character of the state and campaign for it. A vision of a constitutional, secular, pluralistic state based on respect for the rule of law.

In order to be effective he must provide an answer to the central question thrown at him and at all moderates: what benefits has moderation brought us? It is in his hand but also, and just as importantly, in the hands of others who would be his partners, to provide an acceptable answer.

It is his obligation to clean up the system that he inherited, but he now leads, to reform and to provide accountability, safety, and respect for the rule of law and its strict enforcement.

It is the obligation of others to help him deliver to his people what he alone could not do: more freedom, mobility and prosperity with a viable state at the end of the road.

A competition for the hearts and minds of the Palestinian people to choose between two visions is under way: one is looking for a future of a viable free state and the other is yearning for the past to avenge injured dignity and to continue the fight.

It is the collective responsibility of all those who are serious about ending this conflict to shoulder their responsibility to work together to end it in our time. Palestine is the ultimate symbol and winning its mind and soul will determine the future of the Middle East, perhaps world peace, for decades to come.